You won the lottery and will receive $500,000 in 35 years. Assume an interest rate of 5%. What is the value of your winnings today? Round to the nearest dollar and use the $ symbol in your answer. (use a comma if applicable...$34,576 would be the form of a correct answer) dep -------- Fuaces...use a

Q: Your financial adviser recommends buying a 10-year bond with a face value of $1,000 and an annual…

A: We have  Face value of the coupon bond FV =$1000 annual coupon payment (C) =$55 Year of maturity (n)…

Q: Consider a bond with a principal of $1,000 that pays a coupon of $100 per year. If the bond matures…

A: Bond: It is a fixed income instrument that represents a loan made by an investor to a borrower. We…

Q: Cindy is considering going to law school. If she does, she will spend $70,000 on tuition and books…

A: In economics, present value refers to the current value of a future stream of cash flow. Future…

Q: A bond with a par value of 1,000 and with a bond rate of 10% payable annually is sold now for 1,080.…

A: Bond:- It is a type of promise to pay a lender their interest and principal on certain by the…

Q: With an interest rate of 10 percent, the present value of a security that pays $1,100 next year and…

A: Present value = Future / discount rate

Q: "You are interested in buying a piece of real property that could be worth $313,000 in 15 years.…

A: Here, we calculate the given as follow;

Q: What's the value to you of a $1,000 face- value bond with an 8% coupon rate when your required rate…

A: A bond is an instrument being issuer to the holders of indebtedness of the bond.

Q: Is it possible for a one-year coupon bond to have a negative nominal interest rate? Explain, how?

A: Yes, it is possible for a one-year coupon bond to have a negative nominal interest rate as long as…

Q: There is a 4-year, 3 percent coupon bond with 3.5 years Duration. If the market interest rate…

A: Given: Time=4 years Bond %=3 Duration=3.5 year Original yield=9% New yield=9.15%

Q: For questions 3-4, consider the three sequences of incomes below ( P, Q, and R). Each sequence…

A: In economics, present value refers to the current value of a future stream of cash flows. Future…

Q: How long does it take to become a millionaire? A $500,000 investment will hit $1 million in 42 years…

A:

Q: On his sixth birthday, the boy was left with inheritance. The inheritance will be paid in a lump sum…

A: In economics, present value refers to the current value of a future stream of cash flow. Future…

Q: In preparation for Sandara’s college education, her parents want to save ₱400,000 after 12 years.…

A: Given information,  Future value (F)= ₱400,000 Interest rate (r)= 2% Compounding period (m)= 4…

Q: For this question, assume that the interest rate is greater than 0. Given this information and the…

A: Answer: Let us first calculate the present values of X, Y, and Z: Note: Suppose the interest rate is…

Q: Suppose Ford Motor Company issues bonds with a face value of $500 and an annual coupon payment of…

A: Face value is the actual value of a digit in a number. To get the place value of a number, we…

Q: Assume an interest rate of 5%. What is the maximum amount an individual would be willing to give up…

A: Future value (F.V.) = $1 Interest rate (r) = 5% = 0.05% Number of years (n) = 30 years Present value…

Q: Find the Present Value (today) of $144 to be received in two years at the interest rate of 15%.

A: Given information,  Future value (FV): $144 Interest rate (r): 15% Time period (n): 2 years To…

Q: If the price of a one year T-Bill is $2,860 and the value at maturity is $3,000, what would be the…

A: Yield to maturity is given as = (Face value/current value)1/years to maturity - 1 Face value= $3000…

Q: 2.0%? b) Given the selling price from part (a), what was your annual rate of return from owning this…

A: The annual rate of return is the percentage change in the value of an investment. For example: If…

Q: 10. Suppose the interest rate is 5% and that you are to receive three annual payments of $10,000,…

A: The present value is an important financial concept popularly used by business firms and individuals…

Q: which of the following bonds should you buy when interests rates are expected to go up? a) 5 year ,…

A: There is a more prominent probability that interest rate will rise (and subsequently adversely…

Q: True or False: According to the Rule of 72, doubling time increases as interest rates increase. True…

A: Rule 72 refers to the quick formula that is properly used to calculate the number of years required…

Q: Question 3 (2 marks): The Cash Grab Credit Card Company charges a nominal 28 percent interest on…

A: Answer: Given that:     The cash Grab Credit card Company charges a nominal 28 percent interest on…

Q: Suppose you make an annual contribution of $5,000 to your savings account at the end of each year…

A: Future value can be calculated as follows: Future…

Q: (Calculating the present value of an annuity due) What will be the present value of an annuity due…

A: Both parts are given below

Q: If the interest rate is zero, then $100 to be paid in10 years has a present value that isa. less…

A: The present value refers to the today’s value of the future amount that adjusted with the existing…

Q: Akhisha wanted to buy a cell phone which will have a price of P13,000 for 90 days from now due to…

A: Given  The future value of cell phone 60 days from now = P13000 Rate of interest =12% simple…

Q: You are planning to take out a 5 hundred thousand dollar fixed-rate mortgage with a 30- year term…

A:

Q: Calculate the present value of a $1,300 discount bondwith seven years to maturity if the yield to…

A: Formula for calculating present value is shown below. Present value = Future value / (1 + interest…

Q: f a coupon bond has two years to​ maturity, a coupon rate of 8​%, a par value of ​$1000​, and a…

A: Answer: Given, Coupon rate = 8% Par value = $1000 Yield to maturity = 12% Calculation:…

Q: An investment promises to pay into an account that pays you 6 percent annually, $150 per month for…

A: $150 for one month Therefore for one year-150*12=1800 6% of 1800=108 Therefore 1800+108=1908

Q: At what rate of interest compounded annually will an investment double in five years? Find the…

A: The formulae for compounding is A=P(1+r)t A: Accumulated wealth P: Principle payment r: Annual…

Q: The price of a bond with no expiration date is originally $1,000 and has a fixed annual interest…

A: Given Face value of bond = 1000 Annual interest payment = 150 $ Interest rate = 150 / 1000 * 100 =…

Q: 1. Suppose you win a small lottery and you are given the following options: You can receive (1) an…

A: Given:Immediate Payment=$5,000Rate of Interest=6%Number of years=2years

Q: A star baseball player signs a contract that would pay a total of ​$16 million. The player receives…

A: Present value is the current worth of a cash flow at a certain rate of interest and period of time.

Q: If a lender makes a simple loan of $400 for 3 years and charges 5%, then the amount that the lender…

A: 1) Principal=P=$400years=n=3interest=r=5%Interest after 3 years=P×n×rInterest after 3…

Q: A five-year bond with a yield of 11% (continuously compounded) pays an 8% coupon at the end of each…

A: In this question we have to find out the bond's price, bond's duration, effect on the bond's price…

Q: Compute the following: The present value of $25,000 each year for 4 years at a 7 percent interest…

A: Present value: Present value can be calculated by using the following formula:

Q: Suppose you expect to receive a $10,000 bonus from your employer in two years upon completing your…

A: FV = PV (1+ r / 100)^n FV = Future Value PV = Present Value r = rate of interest n = number of years…

Q: QUESTION 1 a) Under what conditions that a discount bond has a negative nominal interest rate? Is it…

A: Nominal interest rate is given as the sum of real interest rate and inflation rate. The Nominal…

Q: Compute the present value of $1,000 to be received in three years if the rate of interest is 11…

A: STEP1 The formula used is for calculating annuity (series of payments which are made at regular time…

Q: Ellah buys a discount bond for $920. When the bond matures, she redeems it for its face value of…

A: Buying price of bond = $920 Future value = $1000

Q: Suppose you think if you were to retire right now, you would have needed $50,000 each year to…

A: The figures for the actual amount of money that inflation can cost seniors are staggering. The LIMRA…

Q: )A man wishes to have P40,000 in a certain fund at the end of 8 years. How much should he invest in…

A: Solution: Given Data Future value (FV)= P40,000 Interest rate(i)= 6%compounded continuously Time…

Q: A star baseball player signs a contract that would pay a total of ​$16 million. The player receives…

A: Present value of annuity of contract is calculated as follows. Present value of an annuity=…

Q: The price of a bond with no expiration date is originally $1,000 and has a fixed annual interest…

A: A perpetual bond is a bond with no maturity date and hence treated as a fundraising instrument.

Q: Define the term effective interest rate, commonly known as annual effective yield, or annual…

A: The interest rate is the rate which is charged by the bank to the borrowers. It is some portion of…

Q: you were offered either a simple interest note or a simple discount note with the following terms:…

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